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BITCOIN

Tax fight reveals Bitcoin's money divide

Sunday, March 15, 2026 · from 3 podcasts, 5 episodes
Bitcoin And | Bitcoin & E…Bitcoin And | Bitcoin & E…Bitcoin And | Bitcoin & E…Rabbit Hole RecapBTC Sessions
  • A stablecoin-only tax exemption push in Washington would cement Bitcoin's status as a taxable asset, not everyday money, validating a strategic rift within crypto.
  • Coinbase's lobbying priorities are under scrutiny, but the broader industry has historically sidelined Bitcoin's foundational needs for its own token-centric agenda.
  • Lightning Network data shows billions in monthly volume for Bitcoin payments, providing evidence against the claim that 'no one is using Bitcoin as money'.

Bitcoin's future as a currency or a digital asset is being decided in Washington.

A fight over a de minimis tax exemption has become a proxy war. This exemption would eliminate capital gains reporting on small transactions, removing friction for using Bitcoin as money. According to Matt Odell on Rabbit Hole Recap, lobbying efforts are reportedly pushing to sideline this exemption for Bitcoin while securing it for stablecoins. Stablecoins are pegged to the dollar, so the exemption is redundant for them. It would, however, leave Bitcoin transactions taxable.

The reported lobbying aligns with a documented shift in D.C. toward stablecoin-only rules, confirmed by Connor Brown of the Bitcoin Policy Institute. Companies like Jack Dorsey's Block, which builds merchant tools on the Lightning Network, need the exemption to validate their business model. As Miles Suter told Bitcoin Magazine, if Bitcoin just becomes digital gold, they failed the mission.

The Lightning Network processed $1.17 billion across over 5 million transactions in November 2025, with Cash App handling one in four outbound payments. This data is the strongest counter to the argument that no one uses Bitcoin as money, an argument reportedly used in Washington to sideline the exemption.

Coinbase's Chief Policy Officer called the lobbying claim a total lie. Its commerce tool doesn't support native Bitcoin payments, only wrapped versions on other chains. The broader crypto industry's legislative priorities, like the FIT21 Act, often sacrifice bitcoiners' interests for token casino regulations.

The schism is between companies that want Bitcoin to be money and those content with it as a digital asset. A stablecoin-only exemption would be a policy win for the latter and a betrayal of the original premise for the former.

Matt Odell, Rabbit Hole Recap:

- Two sources basically starting a couple weeks ago saying… the de minimis tax exemption for bitcoin was being pushed to the wayside for a de minimis tax exemption for stable coins.

- This is looking like it's Coinbase's lobbying team that may be pushing for this.

BTC MarketsETFsAdoptionRegulation

Entities Mentioned

BasecampProduct
BinanceCompany
Bitcoin Policy InstituteCompany
Bull BitcoinCompany
Cash AppProduct
CoinbaseCompany
Netflixtrending
PolymarketCompany
SAS Miningtrending
search_result blocksTool
TetherCompany

Source Intelligence

What each podcast actually said

Rabbit Hole Recap
Rabbit Hole Recap

RABBIT HOLE RECAP #400: COINBASE FIGHTS BITCOIN • Mar 12

  • According to Matt Odell, citing two sources, Coinbase lobbyists are pushing Washington to prioritize a de minimis tax exemption for stablecoins while sidelining a similar exemption for Bitcoin payments.
  • A de minimis tax exemption would remove a major barrier to Bitcoin as everyday money by eliminating capital gains reporting on small purchases like coffee.
  • Odell argues that seeking a de minimis exemption for stablecoins is redundant, as they are pegged to the dollar and any taxable gain is inherently minimal.
  • Coinbase's product focus, such as its commerce tool supporting only wrapped bitcoin on Ethereum or Base, not native Bitcoin, signals the firm's historical alignment with 'shitcoin land' over Bitcoin-as-money, according to the show.
  • In the broader crypto market structure bill FIT21, the only provision seen as favorable to Bitcoin core principles, the Blockchain Regulatory Certainty Act protecting open-source developers, is reportedly intact due to Senator Lummis's efforts.
  • Odell contends the rest of the FIT21 Act is designed primarily to grease the wheels for token casinos and speculative crypto markets, not to support Bitcoin's foundational use cases.
  • The episode frames this lobbying report as part of a recurring pattern where the broader crypto industry sacrifices Bitcoin user interests, like developer protection and self-custody rights, to prioritize its own speculative agenda.
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Bitcoin And | Bitcoin & Economic News
Bitcoin And | Bitcoin & Economic News

Wholly Unholy Matrimony | Bitcoin News • Mar 12

  • The fight for a Bitcoin de minimis tax exemption is exposing a strategic schism between companies building payment infrastructure, which need Bitcoin treated as money, and those content with its status as a taxable digital asset.
  • Podcaster Marty Bent, citing three sources, accused Coinbase of lobbying to limit the de minimis tax exemption to stablecoins only, an accusation echoed by the Bitcoin Policy Institute's Connor Brown.
  • Bitcoin Policy Institute's Connor Brown confirmed a strong political shift in Washington D.C. toward a stablecoin-only de minimis tax rule in recent months, creating headwinds for a broader Bitcoin exemption.
  • Coinbase Chief Policy Officer Faryar Shirzad called the lobbying accusation a total lie, but CEO Brian Armstrong has not made a definitive public statement, prompting public calls for clarity from Jack Dorsey's Block.
  • Jack Dorsey's Block is campaigning for Bitcoin as everyday money, building Lightning tools for merchants, and argues that a de minimis tax exemption is essential to validate its entire payment infrastructure business model.
  • Block's Miles Suter argues that Bitcoin payments are what validate Bitcoin as money, stating if Bitcoin just becomes digital gold, we failed the mission.
  • Lightning Network volume data from November 2025, showing $1.17 billion across over 5 million transactions, provides the strongest evidence against the political argument that no one is using Bitcoin as money.
  • Cash App processed one in four outbound Lightning Network payments in November 2025, demonstrating significant user adoption of Bitcoin for payments.
  • A powerful faction in Washington D.C. is moving to treat stablecoins as the only viable digital currency for payments, a policy outcome that would cement Bitcoin's status solely as a capital asset.
BTC MarketsAdoptionPaymentsRegulation

Civil AI | Bitcoin News • Mar 11

  • Binance has filed a defamation lawsuit against the Wall Street Journal's publisher, Dow Jones, following a report alleging the DOJ is investigating if Iran used the exchange to circumvent US sanctions.
  • Binance stated it never fired employees for raising compliance concerns and fully cooperated with law enforcement, denying the WSJ report's claims.
  • The lawsuit comes while Binance operates under a US-appointed compliance monitor, who has requested records pertaining to the alleged Iranian transfers.
  • Netflix blocked Bitcoin mining firm SAS Mining and lending platform Ledden from sponsoring a boxer's gear for a live-streamed fight, citing a policy against speculative financial products.
  • Ken Halliburton, CEO of SAS Mining, called Netflix's decision incoherent, noting it approved sponsorships from gambling sites Polymarket and DraftKings, which involve real-money speculation.
  • The reversal forced boxer Justin Cardona to replace custom-embroidered trunks at his own expense just a week before the fight, disrupting his preparation.
  • Despite institutional resistance, firms like Mastercard are advancing mainstream crypto adoption through new global partner programs, including with Binance.
  • Binance has a history of legal action against media, having previously sued Forbes in 2020, and pleaded guilty to US AML and sanctions violations in 2023, paying $4.3 billion in penalties.
BTC MarketsRegulationAdoption

Cypherpunk Day | Bitcoin News • Mar 9

  • The US Treasury's new 32-page report to Congress marks a tactical shift, admitting crypto mixers can serve legitimate privacy needs for lawful users, a recalibration from its 2022 sanction of Tornado Cash.
  • Alongside its privacy acknowledgement, the Treasury seeks new legislative tools including a digital asset-specific 'hold law' to let financial institutions freeze suspicious assets and wants to expand Patriot Act surveillance powers to crypto.
  • The Treasury report tries to thread a needle by distinguishing between custodial mixers, which it says must register, and non-custodial ones, recommending no new restrictions on the latter for now.
  • The Bitcoin And host contrasted Bitcoin's clarity with government opacity, stating, 'The whole point is Bitcoin is clear as crystal, but the US treasury is not clear as crystal.'
  • The host asserted that individuals holding their own Bitcoin keys do not fall under any proposed 'hold law' authority sought by the Treasury.
  • In parallel, 29 US lawmakers are pushing for a permanent legislative ban on a US central bank digital currency, reflecting growing political resistance to programmable government money.
  • The political fight over a CBDC is heating up as Bitcoin's apolitical, predictable monetary rules present a stark alternative to government-controlled, programmable money.

Also from this episode:

Protocol (3)
  • Analysts dismissed the mining of the 20 millionth Bitcoin as a non-event for price, with the Bitcoin And host arguing the predictable, transparent scarcity is the system's core feature, not a catalyst.
  • David Ng of Energy Co said the market is entering a new paradigm of a global asset with nearly zero new supply, a view echoed by Raphael Zaguri of Electron Energy who emphasized the unprecedented clarity of Bitcoin's issuance schedule.
  • The Bitcoin And host stated transaction fees are the only true variable in Bitcoin's future, determined by open market forces rather than opaque code.
ProtocolPaymentsAdoptionRegulationStablecoins
BTC Sessions
BTC Sessions

Silent Payments, Pay Join & the Bitcoin Tech Making You Invisible | NVK & Francis Pouliot • Mar 10

  • Francis Pouliot argues that North Americans fundamentally misunderstand global cryptocurrency demand, where people in economies like Argentina lack the financial cushion to withstand Bitcoin's volatility.
  • Pouliot states that real demand outside wealthy nations is for stable banking utility and a stable medium of exchange, not exposure to a speculative, volatile asset.
  • Pouliot outlines a pragmatic view of Bitcoin's evolution, where its ultimate success would render educational and onboarding services like his company, Bull Bitcoin, obsolete.
  • The ideal end state for Bitcoin is a world without fiat, where the technology is so seamless and integrated into daily life that it disappears into the background, requiring no explanation.
  • For now, the transition gap is filled by stablecoins serving daily utility and companies like Bull Bitcoin facilitating the on-ramp, but the mission is to build a system that doesn't need intermediaries.

Also from this episode:

Stablecoins (1)
  • For most of the world, financial freedom currently means access to stablecoins like Tether, not holding Bitcoin, because stability is paramount when people have little money.
AdoptionStablecoinsPayments

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